The price cap on energy is coming down – but there’s an even better way to save

Ofgem, the energy regulator, confirmed last week that from October millions of people should see their gas and electricity bills come down.

That’s because they’ve reduced the price cap on default and standard energy tariffs, from £1,126/yr down to £1,042/yr for a ‘typical’ user. That’s not to say no-one will pay more than £1,042 – it’s based on usage, so the more you use, the more you’ll pay. But Ofgem estimates that 11 million households could benefit from a saving of £84 per year.

However, that doesn’t mean you should assume you’re getting a good deal. And it definitely doesn’t mean you have to wait until October to start saving money!

You can probably find a cheaper deal well below the price cap

The price cap will only benefit you if you’re on a standard or default tariff – and these are often the most expensive tariffs offered. According to MoneySavingExpert, you could save up to £250 a year by shopping around.

How to shop and switch

People often put off switching their energy providers because they think it’s going to be complicated or time-consuming, but it’s really not. Here’s all there is to it:

• Dig out your energy bills to check which tariff you’re on
• Use an Ofgem-accredited price comparison site to see how much you could save.
• Call your provider to see if they’re prepared to knock some money off your bills, or switch you to another of their tariffs that’s cheaper than the one you are on – and if they’re not, switch away!
• If you get a Warm Home Discount, make sure the supplier you’re switching to offers the discount.

Switching to a different tariff or supplier shouldn’t take long – three weeks at the most. No-one will need to visit your home, unless you’ve asked for a smart meter. And your supply will continue uninterrupted. You should notice no difference, except that a different company will be sending your bills. And they will be lower!

Other ways to save

Check out our blog on ways to cut down on your energy bills.